Cybersecurity is gaining market share and proving doubters wrong
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With its late Friday quarterly results and strong guidance, Palo Alto Networks (PANW) fought back against doubters. According to Jim Cramer, the stock surged roughly 15% Monday, further proving that cybersecurity leaders are compelling investments.

According to Cramer, “[CEO] Nikesh Arora snookered all those who thought, ‘Well, this can’t be true,’” referring to some Wall Streeters’ belief that Palo Alto’s unusual decision to report earnings after the market closed on a summer Friday portended bad news. Palo Alto’s stock had fallen about 16% in August ahead of the earnings release.

Rather, the cybersecurity provider reported what Cramer called an “outstanding quarter,” with its fiscal fourth-quarter earnings per share exceeding estimates and its multiyear guidance looking strong. Palo Alto Networks shares are held by Cramer’s Charitable Trust, the portfolio used by the Investing Club. Palo Alto Networks’ ability to gain market share in the increasingly important cybersecurity field was praised by him on Monday.

Cramer said Palo Alto’s huge jump Monday was due in part to short-sellers covering their bets against the stock. They’re sending me an invitation to their funeral for those who are short the stock today.”

As a result of Palo Alto’s presentation, Wall Street analysts have responded favorably.

Cramer quipped, “The bad news was so fabulous that we had 14 price-target increases.”. He described it as “fantastic.”. According to him, Palo Alto “is winning business from everybody.”. He praised their conference call as “one of the most impressive I have ever attended.”.